Medicaid debate: Focus on "able-bodied" Medicaid recipients is aimed at scaling back Obamacare
In the Medicaid debate now raging on Capitol Hill, there is a great deal of confusion about basic facts about the Medicaid population. Some of it stems from mischaracterization of those on Medicaid.
May 3, 2025 —
In the current debate over the budget that the Congress is engaging in, there is much rhetoric coming out from both sides to justify their positions. One persistent theme from the GOP leadership and others, in response to complaints that there are plans to cut people off of the Medicaid rolls, is that they are “going to protect Medicare, Social Security, Medicaid, for people who are legally beneficiaries of those programs,” as House Speaker Mike Johnson claims, but that “we have to root out fraud, waste and abuse, we have to eliminate on, for example, on Medicaid who are not actually eligible to be there. Able-bodied workers, for example, young men, who are– who should never be on the program at all.”
The constant and persistent claim that there are ABLE-BODIED WORKERS on Medicaid, and that this is either a problem, a mistake (they “should never have been on the program”), or worse, “fraud”. This is factually wrong, and a mischaracterization of the goals of the current Medicaid program. Let’s break this down.
What is meant by the term “able-bodied workers” on Medicaid?
Though it is hard to find a place where the critics define what they specifically mean by “able- bodied” recipients on Medicaid, they seem to be referring to those who are not in the groups that were originally eligible for Medicaid by landing in a particular category: children, the permanent and totally disabled, the elderly (usually dually eligible for Medicare and Medicaid), pregnant women. Thus, the “able-bodied” group largely is defined as those who adults and not aged, not disabled. (note that this could include the group of adults who are custodial parents of the children eligible for Medicaid, who are usually on the Temporary Assistance for Needy Families (TANF) program, originally eligible for Medicaid through the AFDC program).
In most cases, the implication is that the so-called “able-bodied” group that is the target for concern is those added to Medicaid because of the Affordable Care Act (ACA), Obamacare, through Medicaid expansion. As Rep. Chip Roy recently said: “These policies derive from the ACA’s Medicaid expansion. Under Obamacare’s expansion, states receive a 90% federal match for able-bodied, working-age adults—far more than the 60% average for traditional populations like low-income children and people with disabilities. Medicaid has significantly moved beyond its 1965 intent.”
Thus it is important to realize that the complaint about so-called able-bodied people being on Medicaid is really a recyling of the efforts to repeal all or portions of Obamacare, which was attempted over 60 times in the 2017-2020 period.
The vast majority of “able-bodied” Medicaid recipients are working
As the term “able bodied workers” implies, the vast majority of these recipients are in fact working, which surprises some not familiar with analysis of Medicaid recipients, though this fact has been well known for decades. As the Kaiser Family Foundation has recently found, using the most recent data available, 92% of Medicaid adults who are not aged or not receiving social security disability benefits were working full or part-time (64%), or not working due to caregiving responsibilities (12%), illness or disability (10%), or attending school (7%). The remaining 8% of Medicaid adults reported that they are retired, unable to find work, or were not working for another reason. In Missouri, the CAHSPER Center found very similar results for Missouri Medicaid recipients: roughly two thirds of the Medicaid population in Missouri age 19-64 are working full- or part-time (67%), and of those not working, 14% report having a work disability or illness, 4% are caregiving for a child under age 6, and 2% are either in school or report being retired. This means that the reason for not working is not identified for 13% of Medicaid recipients in Missouri.
Figure shared courtesy of Kaiser Family Foundation, 2025.
If Medicaid recipients are working, why do they need Medicaid?
Many ask why workers would need Medicaid coverage if they are indeed working? That is, why wouldn’t they be able to get employer-sponsored health insurance, or be able to purchase health insurance in the private market?
It is well known, and has been known to analysts of health insurance markets for decades, that there are many workers who are either not ELIGIBLE for employer-sponsored health insurance (ESI), or were not ELIGIBLE for private health insurance before the passage of Obamacare (due to pre-existing conditions), or for whom health insurance was UNAFFORDABLE due to their low incomes or that health insurance premiums would be a high percentage of their incomes.
Many workers are not eligible for employer-sponsored insurance and the main reasons why are that they are:
part-time workers (generally working under 30 hours per week),
they are temporary workers or in a consulting role (KFF, page 64),
or their employers do not offer health insurance to ANY of their workers (KFF, page 60).
But even if ESI coverage is available, some workers do not accept the coverage, and those are more likely to be workers who have low incomes, work for small firms (who offer insurance with high premiums), or work for certain types of firms (high risk firms) or in high-risk occupations.
The difficulties accessing ESI coverage, even for those who are working, is what led to the passage of Obamacare provisions to enact several major provisions:
banning health insurance firms from basing premiums on pre-existing conditions,
the creation of the ACA marketplaces (for those above the federal poverty line, FPL, up to 400% of the FPL) with significant subsidies for lower-income persons,
and other insurance reforms.
And the encouragement of Medicaid expansion for people not previously eligible for Medicaid, notably single and married persons who are aged 19-64, who are generally not disabled and not custodial parents nor pregnant, and for whom their income is below 138% of FPL. This was the first time that Medicaid was made eligible for single and married persons who were not categorically eligible.
It is important to realize the gaps that existed prior to the passage of the ACA in the private and ESI markets particularly affected workers who were under the poverty line since those above the poverty line can obtain subsidized coverage in the ACA marketplaces. In many states the eligibility levels — even for custodial parents eligible for Medicaid were extremely low (near 20% of FPL in Missouri, for example), so there was an “insurance gap” where people were making too much income (from working usually) to be eligible for Medicaid, but not making enough to afford health insurance. This policy problem was entirely what the Affordable Care Act was designed to solve. After all, these people were largely doing what we want them to do — work if they can — but because of market problems with our health care and insurance system, insurance was not available or affordable to them. Because of a nuance that was not expected to happen when the ACA passed (resulting from the Supreme Court decision on the ACA), in states that did not expand Medicaid this gap could be significant and wide, and remains so in the ten states that have not expanded Medicaid (especially TX, FL and GA, the largest of those states).
Summary and Conclusion
The term “able-bodied” applied to those on Medicaid is now being used, as noted, to parse out a group that could be cut from the program, because of the suggestion that these recipients were “should never be on the program at all” because they were not part of the original group of categorical groups on Medicaid (e.g., children, aged poor, disabled, custodial parents). As noted here the term “able-bodied” is largely a code term for those added to the program recently through Obamacare. In addition, most of these non-aged adults are workers, but are likely on Medicaid because they are either are not eligible for health insurance, or not able to afford private health insurance. Thus, Medicaid coverage was added as a policy option to fill in for a “market failure” that made it difficult or impossible for workers to obtain affordable health insurance. In addition, many of those age 19-64 on Medicaid who are not working are either disabled, caregiving (for a small child or aged parent), or in school. Thus, whether these individuals were not originally in the group covered by Medicaid in 1965, the need for Medicaid coverage for some persons age 19-64 remains significant, and removing this assistance would significantly increase the number of uninsured.
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Analysis by Professor in the School of Public Health, Washington University in St. Louis. Views are the authors own.